Shoppers wander grocery store aisles, checking items off shopping lists. They fumble for clipped coupons in the checkout line and scan loyalty cards at the register only to overspend anyway and come home to discover they overlooked an ingredient, bought something they already had in quantity or forgot the milk.
The consumer with such shopping experiences seems poised to take much greater (and earlier) control of their shopping pattern with reinforcement of smartphones equipped with mobile shopping applications. Smarter phones and shoppers empowered with shopping-related mobile applications are transforming the shopping process. While smartphone-equipped consumers currently comprise only a small percentage of the general public, their attitudes and behaviors may be indicative of a much larger customer base in the future.
Just as the smartphone vastly expanded the range of uses of the basic mobile phone beyond making and receiving calls, the emerging capabilities of smartphones will continue to expand the way consumers perceive their shopping needs, learn about products and promotions, and make purchases. The potential implications of smarter phones are more apparent in the context of seven human sensory dimensions: hearing, seeing, touching, sharing, navigating, thinking and imagining. These seven dimensions are combined to perform smarter shopping experiences for the shoppers.
Eventually companies are building their functionality to be more accessible on smartphone users via focusing on three process categories:
For consumers, this consists of three primary activities centered on product choice, price and evaluation. First, customers decide which product to purchase. Second, customers might explore incentives or cost-cutting strategies by downloading coupons or identifying special offers etc. Third, customers can research products in more detail, motivated by their need for more information or lower prices.
This consists of three primary activities focused on purchasing, payment and rewards. First, customers make a purchase in-store or online. Second, customers can use their smartphones for purchasing. Third, the in-store experience can be enhanced with reward-related offers.
After the planning and initial purchase, mobile technology still has a role in the shopping experience, frequently in the form of ongoing interaction with retailers and manufacturers.
Advanced mobile devices and technologies and a proliferation of shopping-related mobile applications could result in profound changes in the shopping process. Improved mobile devices provide an opportunity for consumer product companies to enhance the pre-store planning experience, play a prominent and helpful role in store, and maintain a valuable, ongoing conversation with shoppers.
Third-party application providers, retailers and consumer product companies have developed mobile applications that simplify and enhance the pre-store planning process. This includes applications that create and manage shopping lists, maintain shopping carts and identify meal plans or recipes. The planning process for shoppers is very important to companies because it represents a starting point where awareness and consideration become initial purchase intent.
Consumers can compare products and prices using myriad mobile applications. For example, shoppers can use retailer applications that increasingly include weekly sales circulars and pricing information. Many retailer sites also highlight product reviews from consumers and experts based on their usefulness as rated by other site users. Furthermore, shoppers have access to many third-party applications that provide useful information across many online and traditional retailers including product information, reviews and ratings, and highlighted recommendations prior to a store visit. Due to the increased transparency of product information via mobile devices, three possible approaches to comparison shopping emerge as particularly applicable.
First, cultivate a forum that allows consumers to share opinions and reviews of your products to make them better positioned to curate conversations. Second, commission independent, expert reviews that help consumers make decisions. Even if your product is what consumers intend to purchase when they enter a store, expert reviews can play a role in defending the purchase intent during the shopping process. Third, become an honest broker of reviews, including competing products. In each of these approaches, companies can begin with an honest assessment of their product’s strengths and deficiencies compared to competitors to understand those situations where their product is especially suited and where to improve their product.
The evolution of smartphone capabilities has brought unprecedented personal connectivity into the physical world of shopping. In the same way the people never leave the house without a wallet or purse, smartphones are nearly always along for the ride. They are effectively co-pilots on shopping excursions, with the smartphones and shopping-related applications representing a new route to consumers in physical stores or online. This path can be used by consumer product companies to engage consumers in a range of ways, including location-based promotions and links to video content using product barcodes.
Consumer product companies should try to enable in-store conversations that help consumers in the short term such as product recommendations and information, and in the long term such as targeted new products based on consumer feedback.
There are several potential benefits of extending the in-store product experience and brand conversation. Mobile channels can increase brand awareness dramatically. And, smartphones can build brand loyalty through product promotion when it is most relevant. Stronger in-store presence can also result in higher product sales whether through a retailer’s mobile channel or a manufacturer’s direct-to-consumer site for hard-to-find SKUs or mainstream products.
Advances in shopping-related mobile functionality are coming from many sources. Traditional and online retailers should focus on developing multifunction mobile applications that help consumers throughout the shopping process. Similarly, third-party applications providers also need to put more effort on developing and releasing innovative shopping-related applications to help with distinct steps during the shopping process, because all these are actually beneficial for not only consumers, but companies and applications developers too. Using mobile applications and channels, consumers receive more rewards points and promotion benefits when they purchase products. In the mean time, brand companies can promote their products with rewards for scanning select products in-store to encourage product consideration. Underlying these mobile applications and functionality is an emerging ecosystem that also includes mobile providers and payment companies to develop and distribute mobile content. Even the benefit is a lot bigger when it comes with close collaboration with each player in stages of shopping.
A mobile presence can serve not only to prompt or initiate purchases, but also to maintain a post-purchase conversation that helps consumers.
Consumer product companies should consider the full lifecycle of their products and enhance it with additional interactions that enrich the product experience and extend the conversation, particularly for brand advocates those valuable consumers that spend an above-average amount on that brand and are actively involved with the brand through engagement and advocacy. Even these active engagements with consumers can yield data for new product development.
Advanced mobile functionality and applications enable rich data collection and analysis across the entire shopping and consumption lifecycle, including contextual information such as physical location, demographics and buying behavior.
Companies can begin by aggregating and modeling data derived from numerous shopping behaviors and location-based analysis of shopper movement. The analytics from these data would be more than effective to help these companies to set the target customer or conduct promotional campaigns for the certain part of the target customer segmentation. In addition, analytical capabilities can help detect and respond to signals more rapidly than competitors through predictive modeling.
Before this smarter phones’ era, never in the history of commerce has it been possible to acquire as much data or participate so extensively in the process of connecting with consumers. Companies should fine-tune these connections as well as their marketing strategies, and they can be well positioned with regard to creating mobile-enabled paths in sync with evolving consumer needs.
This article was provided by Deloitte Consulting Korea.